Speak Your Piece: The ‘Telecom Cartels’

Too many U.S. companies use their political and economic might to protect themselves against true competition. The result for rural communities is an uneven distribution of broadband access.

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Are other countries far ahead of the United States when it comes to broadband?

That question came to me during a workshop in southern Louisiana with rural mayors, members of council and town, city and parish staff. We were discussing how rural communities can get the broadband services they need and how they can turn that broadband asset into economic and social value.

There are two ways to answer that question. Despite what you might read, the objective answer for the nation as a whole is “no.” But there is another answer.

On the objective side, according to a recent report from the Information Technology & Innovation Foundation, “The U.S. is near the top of the rankings in terms of the deployment and adoption of high-speed, wired networks and leads the OECD in adoption of advanced wireless LTE broadband networks. U.S. broadband speeds… also rank in the top 10 in the world.”

Can that be right? Like everything else, it depends on how you measure it. Adoption is based on households with computers, not all households. That makes sense, since a computer of some kind is needed for broadband access. By that measure, the U.S. ranks close to the top. But the U.S. also ranks 16th among the OECD (Organization for Economic Cooperation & Development) nations for household computer ownership, which handicaps the American score a bit.

What about speed and capacity? The U.S. ranks in the top 10 in the world, which is doubly impressive because it has the second lowest population density among the OECD nations. Thinly-populated places cost more per subscriber to cover with wire or fiber, and that handicaps the score of smaller, denser countries.

But the other answer to this question comes from science-fiction author William Gibson. He famously told an interviewer, in response to a question, “the future is here – it’s just not evenly distributed.” The same is certainly true for our broadband future. New Orleans and Lafayette, Louisiana, have high-quality broadband; Cameron Parish, with 3.5 people per square mile, does not.

The U.S. tolerates a much higher level of inequality in broadband distribution – as it does in most social matters – than most industrialized nations. Market forces rule, and markets where providers can make lots of money win out over thinly populated regions that cost too much per user. Most other industrialized nations try to make up the difference with public spending, but that still runs against the grain in America.

This would not matter much, except that it leaves people in rural places at the whim of economic cartels, as I learned vividly during my workshop. The City of Lafayette has exceptional broadband because it built a fiber-to-the-premise network beginning in 2004. Its reward was the chance to fight a $4.5 million legal battle with incumbents to win the right to compete and deliver a network.

Since they failed to shut down the city, the incumbents went to the legislature, where they succeeded in guiding the Local Government Fair Competition Act into law. It should have been called the Cartel Protection Act, because the law blocks every other Louisiana municipality from owning and operating a network offering service to the public – which effectively frees the incumbents not to compete where they don’t want to.

By rights, telecom providers should be the best allies of Intelligent Communities, which are communities that have taken conscious steps to prosper in a broadband economy. I salute those telecom companies with the vision and courage to be exactly that. But so many of them seem to prefer the economics of the cartel. When the guys with the money can also control politics to protect their interests, progress stops. Or it would if the cartels had things all their own way.

What the Lafayette workshop revealed was the great, shared frustration of rural parishes and cities with their inability to get the “high-speed wired network…and advanced wireless LTE broadband networks” that their urban peers enjoy. There was talk of forming a committee to educate rural mayors and councils and to develop policy recommendations that could spark a genuine debate on the state’s broadband policies.

Who knows how far it can go? The anthropologist Margaret Mead once wrote words that still send chills up my spine, “Never doubt,” she said, “that a small group of thoughtful, committed citizens can change the world.”

Why? This is the part that gets those chills rippling upward: because, she wrote “it’s the only thing that ever has.”

Robert Bell is co-founder of the Intelligent Community Forum, a think tank that studies and promotes the best practices of the world’s Intelligent Communities. He can be reached through the ICF Web site.